In December, China’s Ministry of Agriculture (MoA) released its official deep-sea fishing development plan for the period running to 2020, when the current national Five-Year Plan ends. Since 2011, China’s deep-sea fishing industry has rapidly expanded, and the number of domestic deep-sea fishing vessels has increased from 1,628 to nearly 2,900. This trend has not only created regulatory issues, but also led to a rise in illegal fishing.

However, the MoA’s development plan rethinks the prevailing model of rapid expansion. In contrast to the previous Five-Year Plan, which ran from 2011 to 2015 and repeatedly emphasized China’s need for a robust deep-sea fishing industry and increased fishing quotas in international waters, this latest plan focuses on curbing the rising number of fishing vessels and companies as a means to relieve excess capacity within the industry. However, any attempt to carry out this plan is likely to face resistance from local governments.

According to the MoA’s plan, by 2020, the number of deep-sea fishing boats should be kept under 3,000. Think about what that means: Over the next three years, less than 100 vessels can be added to the national fleet. Yet in Fujian and Shandong, two coastal provinces heavily reliant on deep-sea fishing, provincial governments have plans to aggressively expand the size of their respective fleets. Between 2014 and 2020, Fujian aims to add another 430 boats, while Shandong intends to build an additional 81.

As provincial governments seek to expand local fishing industries, they have scrambled to produce huge numbers of industrial vessels that operate across the world’s oceans. But the sheer size of such fleets makes them far more difficult to regulate, and the rising number of illegal fishing incidents involving Chinese fishing vessels has negatively impacted China’s image abroad. In March 2016, a Shandong-based Chinese fishing boat, the Lu Yan Yuan Yu 010, was discovered fishing in Argentina’s exclusive economic zone, where it was chased and sunk after refusing to cooperate with the local coast guard. The crew members were rescued by Argentines and nearby Chinese fishing boats. Then, in August last year, Ecuadorian police seized the Fujian-based Fu Yuan Yu Leng 999 on suspicion of having illegally caught endangered sharks while fishing in international waters.

The Chinese government urgently needs to put the brakes on the industry’s growth to prevent further damage to the country’s international image. Therefore, it is crucial that the MoA’s new development plan is implemented quickly and effectively at the local level. Last December, the ministry issued its first industry blacklist, which currently has 15 company owners and ship captains who are banned from deep-sea fishing for previously engaging in illegal activities. Any attempt to further rein in the fishing industry must also involve constant updates to this blacklist. The list should be made available to the public and the government should establish specific penalties for those who fish illegally.

Fishing subsidies have not only caused excess capacity within the industry and burdened national finances, but also damaged fragile global fisheries.

- Bastiat Liu, policy analyst

The MoA’s new plan also takes a different approach to China’s cooperation with other coastal countries that allow the Chinese fleet to fish in their waters. For the past few decades, Chinese fishing companies have established cooperative agreements with foreign governments. The Chinese government has long supported this model and encouraged businesses to come to long-term, stable arrangements with countries willing to give Chinese vessels access to their waters.

However, in countries wracked by political instability or underdeveloped infrastructure, the lack of intergovernmental cooperative frameworks has saddled the Chinese fishing industry with high business costs. Obtaining fishing rights, jumping through the necessary regulatory hoops, and buttering up local officials and law enforcement is an expensive ordeal. As a result, fishing boat captains often look to maximize profits by catching as many fish as possible in a short space of time. This model rapidly depletes fisheries, endangers the sustainability of local ecosystems, and sometimes sparks backlash among local residents.

In light of the problems with the business-to-government growth model, the new development plan now calls for the direct establishment of bilateral mechanisms between governments in order to better regulate the fishing industry. Last November, China signed an official bilateral memorandum of understanding with Sierra Leone. In the same month, it revised a 1991 agreement on fishing with Mauritania. These moves signal a return to intergovernmental cooperation after decades of allowing fishers to negotiate directly with African countries.

Sixteen African nations currently allow Chinese vessels to fish in their waters, but many fisheries agreements date back 30 years or more, and contain provisions ill-suited to contemporary environmental needs — in particular, the need to place more stringent checks on modern vessels that have considerably greater capacity than those of a few decades ago. Consequently, the MoA’s new plan signals China’s willingness to take on more regulatory responsibility for ensuring the sustainable development of the global deep-sea fishing industry.

But stronger regulations and penalties will not be enough to control China’s unruly fishing industry. We must also resolve the problem of excess production capacity. Deep-sea fishing is expensive to operate, and fishing boats burn through large quantities of fuel on a daily basis. The high price of fuel means that some companies would operate in the red were it not for generous government fuel subsidies and tax breaks. This policy has not only caused excess capacity within the industry and burdened national finances, but also damaged fragile global fisheries. If we want to move forward, the only option is to abandon this practice, even if it means that some businesses will die.

Both national governments and the global environmental community recognize the fact that state subsidies designed to stimulate the deep-sea fishing industry are damaging the sustainability of global fishing resources. Regrettably, although the MoA’s development plan contains no references to actively continue subsidizing fishing businesses, nor does it lay a path toward future reform of the subsidy policy.

Last month, the World Trade Organization (WTO) held a meeting in Argentina to discuss the issue of fishing subsidies, but member states were ultimately unable to come to a consensus on the best way to restrict them. China’s delegation proposed a plan to discontinue subsidies to businesses known to have engaged in illegal fishing, a measure designed both to complement the country’s blacklist initiative and to show the government’s commitment to crack down on illegal fishing. Yet this measure puts the cart before the horse; if the Chinese government truly wants to tackle the myriad problems in deep-sea fishing, it must get rid of all the subsidies.

Obviously, China’s deep-sea fishing fleet is huge, and attempts at reform must be handled with sensitivity. But the government can take heart from the effective changes to subsidies given to its equally oversized coastal fishing fleet. In 2015, China announced that subsidies to coastal fishermen would be cut to 40 percent of 2014 levels by the year 2019, in order to force its domestic fishing and aquaculture industries to channel funds into fisheries conservation and new infrastructure. Experts estimate that the number of domestic fishing fleets along China’s eastern coast decreased by more than 4,000 vessels between 2015 and 2016.

The initial success of the coastal fisheries policy can serve as a model for deep-sea fishermen as well. By diverting funds currently earmarked for greater production into resource conservation and job retraining for the fishermen, the government can gradually wean the industry off its dependence on subsidies. This, in turn, can promote the sustainable development of the world’s fishing stocks.